According to a Belgian law passed in 1980, only professionals can benefit from a tax deduction. An individual shareholder of a foreign company will first be taxed abroad on his financial assets and will then be taxed in Belgium.
In its ruling handed down by the Cour de Cassation, the Belgian judge pointed out that this law is contrary to the International Convention of double taxation signed between France and Belgium. Since international treaties represent a higher standard on Belgian Law, the treaty must prevail and therefore the Belgian tax administration must also grant this tax deduction to individual investors.
This ruling will have two major consequences for Belgium. First and from a financial perspective, the Belgian administration will have to pay back the over payment by individual investors. The application of the International Treaty will also represent a loss of income. Secondly, it appears that the taxation on dividends from French shares will be lower than the withholding tax applied on dividends for Belgian shares.
Read the full article in l’Echo ( in French) here